Trinidad & Tobago Country Statistics

LOCATION

Located 11 km (7 miles) off the north-eastern coast of Venezuela and at the most southern tip of the Caribbean archipelago, the twin-island nation of Trinidad and Tobago is strategically positioned for trade with neighbouring islands as well as with North and South America.

TRINIDAD AND TOBAGO ECONOMY

Trinidad and Tobago is the largest economy in the Caribbean Community (Caricom) and its petroleum sector is the main driver of economic growth. In the early 1990s the petroleum sector evolved from being oil-dominant to a natural gas-dominant sector. Despite being one of the world’s largest exporters of ammonia and methanol, the energy sector is currently undergoing a period of transformation. The state-owned Petroleum Company of Trinidad and Tobago Ltd. (PETROTRIN) was officially closed in late 2018, due to its low profitability and since 2015, the energy sector has been plagued with weak global energy prices, declining oil production and an inconsistent stream of natural gas output.

Between 2000 and 2007, the domestic economy experienced healthy expansion with real GDP growth averaging around 8 percent. Although the nation weathered the 2008 financial crisis better than many other countries, economic growth remains patchy and the government has been running on fiscal deficits for more than five consecutive years. In 2019, the economy suffered its fourth consecutive year of contraction (-1.2 percent), following marginal growth of 0.1 percent in 2018. The decline in export earnings and the tight foreign exchange market have placed some pressure on the TT currency, which has depreciated slightly over the last five years. The TT$/US$ exchange rate averaged 6.6715 in 2016 but has since increased to 6.78 in 2019. While the foreign reserves position weakened over the abovementioned period, it is still considered to be healthy at 8.6 months of import cover, as at the end of November, 2020.

However, the COVID-19 pandemic ruled out any chance for a return to economic growth in 2020. Net public sector debt as a percentage of GDP increased from 60.4 percent in fiscal 2018 to 65.5 percent in fiscal 2019. The Ministry of Finance expects this figure to increase further to 80.7 percent in fiscal 2020 due to an uptick in government spending aimed at alleviating the financial burden of many citizens during the height of the pandemic in 2020. Unsurprisingly, the Ministry projected that the overall fiscal deficit will increase in fiscal 2020 by 316 percent to TT$16,772 million from TT$4,028.9 million in the previous fiscal. At this juncture, there is a significant amount of uncertainty pervading the global economy but Trinidad and Tobago is known for its resilience and tends to punch above its weight.

Within this tiny 4,828 square kilometres of land and a meagre population of just 1.3 million, we possess Olympic gold medallists, beauty pageant winners, world-renowned authors, musicians and scholars as well as a world-record holder. Furthermore, Trinidad and Tobago can boast of its well-developed industrial sector and a number of experienced industrial services companies. The domestic manufacturing sector is also diverse, with businesses in areas such as food processing, pharmaceuticals, alcoholic beverages, cosmetics, steel, cement, glass and plastics. Tobago is mainly dependent on tourism as it has a strong nature and ecotourism appeal.

Nevertheless, the business sector is not without challenges. This jurisdiction is currently ranked 79th out of 141 countries in the World Economic Forum’s Global Competitiveness Report 2019. Moreover, in the World Bank’s Doing Business 2020 Report, the country is ranked 105th out of 190 countries in Ease of Doing Business with weak scores in areas such as Enforcing Contracts, Paying Taxes and Registering Property.

On May 22nd, 2020, Moody’s Investors Service affirmed its Ba1 long-term issuer and senior unsecured debt rating for Trinidad and Tobago. On the other hand, the rating agency downgraded the country’s outlook from stable to negative on the basis of pre-existing economic challenges that are now being exacerbated by the severe shock to global oil and gas demand and prices, triggered mainly by the coronavirus pandemic. Nevertheless, there is room for optimism, as COVID-19 vaccines are currently being administered across the globe with the hope of attaining worldwide herd immunity by the latter half of 2021. For mankind, these are both unprecedented and uncertain times, nonetheless Trinbagonians possess the wherewithal to not only surmount the related challenges, but to also emerge stronger on the other side.